About COVA
COVA is responsible for the Dutch strategic oil stocks. These provide energy security in times of crisis, for instance during the conflict between Russia and Ukraine.
What does COVA do?
COVA maintains strategic oil stocks for the Netherlands. We do this on the instructions of the Minister of Climate Policy and Green Growth (KGG) and in accordance with international arrangements with the International Energy Agency (IEA) and the European Union (EU).
The oil stocks can be released during national or international oil shortages or energy crises, for instance during the conflict between Russia and Ukraine. As a provider of strategic stocks and market intelligence, COVA is part of the national crisis organisation. This has been laid down in the National Oil Crisis Plan (LCP-O). In this way, we provide energy security for a changing world.
Remit:
COVA manages the strategic stock of the Netherlands by purchasing, selling and storing crude oil and oil products. The stock is maintained with minimum storage risks and at the lowest possible cost, so as to enable a timely and flexible response to national and international developments.
Providing market intelligence is another important part of our remit. Because COVA plays an active role in the oil and storage market we maintain access to current market information and outlooks. By analysing and monitoring data, we can oversee potential developments and act accordingly. Using this knowledge, we advise the Ministry on policy decisions. We make the current oil market situation transparent for everyone.
Crisis approach
When and how are we involved in an oil crisis? The IEA coordinates international measures in case of a disruption of global oil supplies. The governments of IEA countries, including the Netherlands, are then requested to make up a part of the oil shortage. They can do so by releasing oil from their own stocks, or by limiting domestic demand. The European Commission advises the EU Member States on the measures to be taken
An international request is received by the Minister of Climate Policy and Green Growth. In consultation with COVA, the Minister decides how the Netherlands will deploy the strategic stock. This may also entail that we need to transfer the stock held abroad to the Netherlands. The Minister may also introduce demand restraint measures, for instance by reducing the maximum speed or increasing obligations to blend in renewable fuels. In extreme cases, the central government may requisition oil products. The Minister of KGG will consult with other ministries and various advisory groups to determine what measures will be useful.
Organisation
COVA is a not-for-profit foundation with a statutory task. The Minister of Climate Policy and Green Growth bears the ultimate responsibility for COVA, sets its articles and rules of procedure and appoints the Board. The Managing Director is responsible for COVA’s day-to-day management and reports to the Board. Each year, the Board submits the budget and the annual report to the Minister for approval. This structure guarantees COVA’s independent position in the Dutch oil market. We work with a small team of eight specialists with backgrounds in the energy industry, public sector and think-tank community.
Based on our social task in the energy transition, we attach great value to transparency, equality and inclusion. We have documented this in our Code of Conduct.
International cooperation
IEA members and EU Member States all meet the stockholding obligation in their own way: through agencies (such as Belgium), state entities (such as the United States), the business sector (Sweden) or a dual system such as the Netherlands. All these parties cooperate intensively in order to cope with an oil crisis collectively. We share experiences and best practices during the Annual Coordinating Meeting of Entity Stockholders (ACOMES), which COVA have chaired since 2024.
This interactive map shows all the agencies and state entities worldwide.
COVA counsels the Ministry of Climate Policy and Green Growth during consultations with the IEA in the Standing Group on Emergency Questions (SEQ) and the Standing Group on Oil Markets (SOM). Under the Ministry’s direction, we also take part in the consultations of the EU’s Oil Coordination Group in an advisory role.
Until now, there have been five occasions on which the IEA countries together made up oil shortages in order to restore confidence in the oil market. The most recent of these are two collective actions in 2022 in response to developments resulting from the Russian invasion of Ukraine. In addition, stocks were released during the Gulf War (1991), after Hurricane Katrina (2005) and as a result of the civil war in Libya (2011).
Laws and regulations
COVA’s tasks are set out in the Petroleum Products (Stockpiling) Act (Wva).
The international obligations are described in the IEP Treaty and EU Directive 2009/119/EC. In the Netherlands, the international arrangements have been laid down in the Wva 2012. Further information on these arrangements can be found under Statutory Basis.
COVA must comply with the Senior Executives in the Public and Semi-Public Sector (Standards for Remuneration) Act (WNT) and is exempt from corporate income tax. In the context of the Network and Information Systems Security Act (Wbni), COVA has been designated as an Operator of an Essential Service.
History
The need for international cooperation arose after the global oil crisis of 1973-1974. Under the auspices of the Organization for Economic Cooperation and Development (OECD), the International Energy Agency (IEA) was founded. All the associated industrialised countries became obliged to maintain emergency oil stocks for crisis situations. The Netherlands introduced the Petroleum Products (Stockpiling) Act (Wva).
In order to meet its stockholding obligations, the Dutch government in 1978 set up the interim agency ICOVA: the Interim Netherlands Petroleum Stockpiling Agency (Stichting Interim Centraal Orgaan Voorraadvorming Aardolieproducten). In 1987, this became the independent Netherlands Petroleum Stockpiling Agency (Stichting Centraal Orgaan Voorraadvorming Aardolieproducten, COVA). Since then, oil stocks are maintained on the instructions of the government.